Fuel Cells Popping Up In California

Behind a chain-link fence next to a parking structure at an office park in the San Gabriel Valley sit five softly humming gray boxes that could change the way homes and offices are powered. The boxes — each somewhat bigger than an SUV — will begin generating enough electricity to power about a quarter of the complex, saving the property owner about $500,000 a year in electricity bills.

The Energy Servers use fuel-cell technology to create low-emission electricity. The product, developed by Bloom Energy, a Sunnyvale, Calif., start-up, has been hailed as an innovation that could change the power industry.

“We were convinced that this was a technology that was extraordinarily good,” said Wayne Ratkovich, chief executive of Ratkovich Co., which owns the Alhambra office park. “And we’re not paying as high of an electric bill, so we’ll save a lot of money.”

Assuming the boxes at the Alhambra do their job, Ratkovich is considering adding five more. And if he does, the new units won’t be hidden behind a fence.

The Bloom boxes take the oxygen from the air and combine it with fuel such as natural gas in an electrochemical process that produces electricity without using combustion.

Each unit costs up to $800,000, or $4 million for the set. At that rate, Ratkovich Co. could recoup its costs in less than a decade. Each box comes with a 10-year warranty.

So far, Bloom hasn’t had a heavy presence in Southern California. A Wal-Mart store in Lancaster installed a 400-kilowatt system last December, followed by another in Hemet. A Staples store in Ontario has a 300-kilowatt setup.

But many of the high-profile systems are located in the Bay Area: Google Inc. installed a 400-kilowatt set at its Mountain View headquarters and EBay Inc. has a 500-kilowatt group in San Jose.

Bloom plans to have about 100 systems installed by the end of the year. The company may branch out internationally in the future but is currently focusing on delivering a backlog of units in the United States, said Asim Hussain, director of product marketing.

San Diego city officials recently partnered with BioFuels Energy to buy three fuel-cell power plants from FuelCell Energy Inc., which will tap biogas to create clean power for UC San Diego and a municipal water facility.

Their fuel cells produce about 5 kilowatts of electricity, cost around $56,000 each and have a 20-year estimated life. Buyers are eligible for tens of thousands of dollars in government rebates and tax incentives. CEO Russell Ford says he expects to sell 1,000 units and make a profit in 2011. The company, which has locations in California and Oregon, is stepping up its manufacturing.

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